Unsuitable model

Experts doubt whether India needs to follow the fully-open western models for reviving its agriculture sector

- PRATUL SHARMA

On October 22, during the US presidential debate, Donald Trump and Joe Biden had an argument over farmer subsidies. Trump boasted that he had paid $28 billion of subsidies to the farmers, to which Biden responded that it was taxpayers' money. The money was paid by the US government to help farmers tide over losses due to trade restrictions with China—the third-largest importer of America's agricultural products, particularly soybean and corn.

Since the sanctions, the US farmers have relied heavily on government support and got 40 per cent of their net cash income from it. The doles given to American farmers in 2020 amounted to nearly $46 billion. The European Union's common agricultural policy (CAP) gives out $64 billion per year in farming subsidies to its 27 member states. This amount comprises nearly one-third of the EU budget.

Even in the free economies, agriculture is not left to the mercy of market forces. The agriculture sector is affected the most by volatility in prices, so it requires government interventions. In November 2019, when Prime Minister Narendra Modi decided to stay out of the Regional Comprehensive Economic Partnership, one of the intentions was to protect Indian farmers from dumping of dairy products. His legislation to open up the agriculture sector to the private sector, however, has alarmed Indian farmers.